The power of product positioning

written by Tim Berry of Palo Alto Software


Product positioning is closely related to market segment focus. Product positioning involves creating a unique, consistent, and recognized customer perception about a firm’s offering and image. A product or service may be positioned on the basis of an attitude or benefit, use or application, user, class, price, or level of quality. It targets a product for specific market segments and product needs at specific prices. The same product can be positioned in many different ways. The figure below is taken from Philip Kotler’s book, Marketing Management published by Prentice Hall. This two-dimensional perception map shows how Kotler analyses the positioning of an instant breakfast drink relative to variables of the price of the product and the speed of preparation.

Another common framework for product positioning is taken from a series of questions. You can position a product using a positioning statement that answers these important questions:

  • For whom is the product designed?
  • What kind of product is it?
  • What is the single most important benefit it offers?
  • Who is its most important competitor?
  • How is your product different from that competitor?
  • What is the significant customer benefit of that difference?

For example, the following are positioning statements used by Palo Alto Software to focus marketing of two new products introduced in late 1994:

Business Plan Pro

“For the businessperson who is starting a new company, launching new products, or seeking funding or partners, Business Plan Pro is software that produces professional business plans quickly and easily. Unlike (deleted), Business Plan Pro is a stand-alone product, and requires no other programs to buy or learn.”

Marketing Plan Pro

“For business owners and managers who oversee their company’s marketing programs, Marketing Plan Pro is software that creates and helps manage professional marketing plans. Unlike our most aggressive competitor, Marketing Plan Pro provides a system for scheduling and tracking the entire marketing process from plan to action.”

Some positioning strategies work better than others.   The best positioning plays to your company’s strengths and the product’s strengths, and away from weaknesses. Position your product to reach the buyers whose profiles most closely match the needs you serve, in the channels you can reach, at prices you set.

Tim Berry

about the author

Tim Berry

Founder and President of Palo Alto Software and a renowned planning expert. He is listed in the index of "Fire in the Valley", by Swaine and Freiberger, the history of the personal computer industry. Tim contributes regularly to the bplans blog, the as well as his own blog, Planning, Startups, Stories. His full biography is available at Follow Tim onGoogle +


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